U.S. Stocks Advance On China Optimism, JetBlue Sweetens Spirit Bid

Barry Adams
06 Jun, 2022
New York City

U.S. stocks trade higher in morning after a week of moderate losses and crude oil jumped after Saudi Arabia lifts oil prices. 

The S&P 500 index jumped 1.1% to 4,155.35 and the Nasdaq Composite index advanced 1.6% to 12,751.00. 

The yield on 10-year Treasury notes inched higher to 2.972%. 

Crude oil jumped 15 cents to $119.30 a barrel and narrowed the spread with the Brent crude oil trading at $119.95. 

In the morning rebound, stocks gained on hopes that the President Biden's administration's plan to rollback tariffs on imports from China may ease pressures on inflation. 

China loosened mobility and gathering restrictions after the coronavirus spread subsided. 

Investors also looked ahead to the European Central Bank's policy meeting on Wednesday that may offer more clarity on the rate decision on July 21. 

Investors are battling multiple global shocks not seen in a century. 

Economies around the world are impacted by once a century pandemic, war in Europe after 75 years, and global food and fuel price surge lifting the inflation to a 4-decade high. 

In addition, central banks in Europe and the U.S. are set to lift rates after fifteen years or near zero rates or negative rates. 

In premarket trading following stocks reacted to the latest news. 

Spirit Airlines jumped 5.7% to $20.74 after JetBlue sweetened its bid to $31.50 a share and proposed to increase breakup fee to $350 million. 

Didi Global surged on news that Chinese authorities are concluding investigations of the company and the ride-hailing company will be permitted to add new users. 

The news was first reported by the Wall Street Journal. 

Apple Inc jumped 1.6% to $146.90 and the company is set to kick-off its annual Worldwide Developers Conference today. 

ON Semiconductor jumped 6.1% to $62.94, VICI Properties gained 6.4% to $31.39, Keurig Dr Pepper advanced 5.9% to $34.93 after three companies were selected to be included in the popular S&P 500 index.   

Under Armour declined 0.8% to $10.08 after the company's stock was dropped from the S&P 500 index. 

European markets traded higher after the U.S. proposed to roll-back tariffs on China products. 

The DAX index gained 1.4% to 14,655.95, the CAC-40 index rose 1.35% to 6,573.11, and the FTSE 100 index added 1.3% to 7,629.77. 

Asian markets advanced after China eased mobility restrictions as life returns to normal after two months of severe lockdowns to halt the spreading of coronavirus. 

The Nikkei index jumped 0.5% to 27,915.89, the Hang Seng Index soared 2.7% to 21,653.90, and the Sensex index edged down 0.2%. 

The Reserve Bank of India is set to lift its rate tomorrow by 50 basis points after inflation indexes jumped to eight-year highs. 

The ASX 200 Index dropped 0.5% to 7,206.30 and the broader All Ordinaries Index fell 0.5% lower to 7,433.10.

The Reserve Bank of Australia is also set to lift its benchmark interest rate between 25 and 40 basis points.